Yesterday, 13 May, CML Group announced to the ASX that its proposed acquisition by Scottish Pacific will not be proceeding.
CML Group provides debtor, equipment and trade finance to SMEs through its Cashflow Finance and Classic Funding Group brands. Over the last several months, the group has been the subject of a takeover offer from Affinity-owned Scottish Pacific.
The deed that set out the key terms of the arrangement has been terminated by “mutual agreement”, with both parties now released of their obligations.
The CML board and management “are disappointed” the transaction is not proceeding, but remain confident in the future of their busines.
CML chairman Greg Riley said, “The agreement reached to terminate the transaction was made in the best interests of the company and shareholders and we are confident that CML has a strong future as an independent company.”
Scottish Pacific will pay CML a $1m break fee to cover corporate costs associated with the implementation of the Scheme of Arrangement, and has agreed to a standstill on making further offers for CML for a period of 12 months.
CML Group CEO Daniel Riley said, “CML continues to be in a position to support Australia’s SME community and financial intermediaries with a competitive choice of funding options, at a time when many are struggling to secure appropriate capital funding.
“Through our trading divisions, Cashflow Finance and Classic Funding Group, CML provides financial support to over 5,000 Australian small businesses and we are delighted to be able to continue to do so without disruption.
“Over the past few months, we have successfully partnered with our clients providing them with enhanced funding solutions to support them in navigating through the current challenging market conditions.”